Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited condensed consolidated financial statements and accompanying notes included under Item 1 of this Quarterly Report on Form 10Q and our audited consolidated financial statements and accompanying notes included in our Annual Report on Form 10-K for the fiscal year ended November 30, 2022.

Outlook

In these challenging market conditions, the Lennar team has remained focused on production and pace, cash flow, inventory turns and return on capital, which have produced solid results for the second quarter. As a result, we ended the second quarter with stronger-than-expected revenues and deliveries, strong profitability and cash flow, a fortified balance sheet, strong liquidity and low leverage. These results are consistent with the stabilization that we have seen in the current economic environment, together with our adherence to our core operating strategies described below.

The economic environment for the homebuilding industry has stabilized as customers have adjusted to and accepted higher interest rates for longer terms, supply chain disruptions have normalized, inventories have remained low, and the supply of housing across the country has continued to be very limited. While persistent inflation remains, the steep interest rate hikes which began in 2022 have given way to moderated and measured rate movements, allowing the market to adjust in an orderly fashion. Strong demand for housing, which had previously been curtailed by price and affordability challenges, has returned while the housing market has adjusted prices, incentives, including rate buy-downs, and production costs to facilitate homebuying by customers. Although interest rates and affordability have been the primary headwinds to demand, the housing supply shortage has kept inventory levels very low, which in turn has continued to drive customers to stretch their finances as incentives and price reductions have combined to increase affordability and drive demand.

The average sale price of homes has declined year over year through price reductions, together with the use of interest rate buy-downs and other incentives, and the average sales price sequentially has stabilized, as demand has returned. With volume and production as constants, we use margin as our volatility shock absorber. If market conditions deteriorate, we compromise margin through price reductions and increased incentives, but we generate strong cash flow. If conditions improve, we improve margins and bottom line while also generating strong cash flow. Our primary focus is on cash flow.

We have remained steadfast in our adherence to the core strategies we adopted when the Fed began its tightening program and interest rates began to rise over a year ago.

• We will continue to utilize our Dynamic Pricing Model in conjunction with our digital marketing platform to focus on selling homes at market-clearing prices and drive volume while building at a consistent pace to meet the needs of a supply-constrained housing market.

• We will continue to work side-by-side with our trade partners to right-size our construction costs to current market conditions, while we reduce cycle time to pre-supply chain crisis levels. We expect previously negotiated cost reductions to be reflected in our reported numbers in the back half of the year.

• We will continue to sharpen our attention on land and land acquisitions by relentlessly focusing on protecting cash and only purchasing land that delivers strong margins at today’s market pricing, thereby reducing land exposure. We have made significant progress in reducing land held on our balance sheet, with 70% of our land controlled and 30% of our land owned at this time. Like our trade partners, our land partners or sellers have become strategic partners in maintaining volume and increasing market share while concurrently helping to reduce cost.

• We will continue to manage our operating costs and reduce our S,G&A expense so that even at lower gross margins, we will drive a strong net margin. We have been improving our S,G&A leverage over the past years quarter-by-quarter to new record lows and many of those changes, though not all, are hard-wired. We also know that in more difficult times, there will be upward pressure on some of our sales, marketing and realtor costs in order to find purchasers and drive new sales. However, we believe if we continue to drive volume, we’ll be able to constrain increases and manage to attractive cost levels and net margins.

• We will continue to maintain tight inventory control. We have recently significantly improved inventory control by focusing on selling homes in inventory and increasing our attention to, among other things, underperforming communities. We are focused on clearing homes that are complete and closable, rather than selling homes that we intend to close many quarters in the future. Inventory has remained flat as opposed to being lower year-over-year as one might expect, because of expanded cycle time due to the supply chain disruption. We expect to bring down our cycle time over the next few quarters. This will free up a significant amount of cash that currently is tied up in the increased inventory dollars related to homes under construction.

• We will continue to focus on our cash flow and bottom line to protect and enhance our already strong balance sheet. We expect to continue to generate considerable earnings and cash flow which will give us the flexibility to retire debt and purchase stock opportunistically which will improve total shareholder returns and return on equity.

Despite the recent moderation in interest rates and a pause in the more aggressive interest rate hikes, significant inflation remains in the economy. Market conditions have leveled and stabilized, at least for now, and we will continue to execute on our core strategies. We are extremely well positioned to navigate the uncertainties of the current market. We engaged the difficulties of the past year with a consistent strategy that promoted strong execution throughout the company. When market conditions were difficult and uncertain, Lennar associates knew their mission. Similarly, as the market has leveled, Lennar associates know their mission and exactly how to execute.

Accordingly, we will continue to provide broad ranges to give some boundaries for various components of our expected results for the third quarter of 2023 and full year 2023. We expect our new orders for the third quarter of 2023 to be in the range of 18,000 and 19,000 homes. We expect our deliveries for the third quarter to be between 17,750 and 18,250 homes with a gross margin between 23.5% and 24.0%. We expect our S,G&A expenses as a percentage of home sale revenues to be between 6.7% and 6.8% but that percentage will adjust based on deliveries and homebuilding revenue. We expect our third quarter ending community count to be flat with our second quarter, although we expect solid year-over-year growth in this measure by the end of fiscal 2023. Our third quarter average sales price should be consistent with the second quarter. Additionally, we are targeting delivery volume for the full year 2023 to be between 68,000 and 70,000 homes as we drive volume and build margins back up through reconciliation of construction and land costs while carefully managing S,G&A expenses.

(1) Results of Operations

Overview

We historically have experienced, and expect to continue to experience, variability in quarterly results. Our results of operations for the three and six months ended May 31, 2023 are not necessarily indicative of the results to be expected for the full year. Our homebuilding business is seasonal in nature and generally reflects higher levels of new home order activity in our second and third fiscal quarters and increased deliveries in the second half of our fiscal year. However, a variety of factors can alter seasonal patterns.

Our net earnings attributable to Lennar were $872 million, or $3.01 per diluted share, in the second quarter of 2023, compared to net earnings attributable to Lennar of $1.3 billion, or $4.49 per diluted share, in the second quarter of 2022. Excluding mark-to-market gains (losses) on technology investments in both years, second quarter net earnings attributable to Lennar in 2023 were $852 million or $2.94 per diluted share, compared to second quarter net earnings attributable to Lennar in 2022 of $1.4 billion or $4.69 per diluted share.

Financial information relating to our operations was as follows:

			Three Months Ended May 31, 2023
(In thousands)			Homebuilding						Financial Services						Multifamily						Lennar Other						Corporate						Total
Revenues:
Sales of homes			$	7,636,579					—						—						—						—						7,636,579
Sales of land			16,314						—						—						—						—						16,314
Other revenues			17,124						222,979						151,744						411						—						392,258
Total revenues			7,670,017						222,979						151,744						411						—						8,045,151
Costs and expenses:
Costs of homes sold			5,916,325						—						—						—						—						5,916,325
Costs of land sold			11,932						—						—						—						—						11,932
Selling, general and administrative expenses			510,700						—						—						—						—						510,700
Other costs and expenses			—						110,380						154,354						6,795						—						271,529
Total costs and expenses			6,438,957						110,380						154,354						6,795						—						6,710,486
Equity in loss from unconsolidated entities			(12,279)						—						(5,926)						(31,550)						—						(49,755)
Other income (expense), net and other gains (losses)			(4,372)						—						374						(5,962)						—						(9,960)
Lennar Other unrealized gains from technology investments			—						—												25,497						—						25,497
Operating earnings (loss)			$	1,214,409					112,599						(8,162)						(18,399)						—						1,300,447
Corporate general and administrative expenses			—						—						—						—						124,752						124,752
Charitable foundation contribution			—						—						—						—						17,074						17,074
Earnings (loss) before income taxes			$	1,214,409					112,599						(8,162)						(18,399)						(141,826)						1,158,621

			Three Months Ended May 31, 2022
(In thousands)			Homebuilding						Financial Services						Multifamily						Lennar Other						Corporate						Total
Revenues:
Sales of homes			$	7,963,683					—						—						—						—						7,963,683
Sales of land			7,524						—						—						—						—						7,524
Other revenues			6,775						200,166						176,021						4,527						—						387,489
Total revenues			7,977,982						200,166						176,021						4,527						—						8,358,696
Costs and expenses:
Costs of homes sold			5,610,783						—						—						—						—						5,610,783
Costs of land sold			7,815						—						—						—						—						7,815
Selling, general and administrative expenses			486,555						—						—						—						—						486,555
Other costs and expenses			—						96,231						175,152						8,236						—						279,619
Total costs and expenses			6,105,153						96,231						175,152						8,236						—						6,384,772
Equity in earnings (loss) from unconsolidated entities			4,862						—						(202)						(16,467)						—						(11,807)
Other income (expense), net and other gains (losses)			2,720						—						1						(10,283)						—						(7,562)
Lennar Other unrealized losses from technology investments			—						—						—						(77,965)						—						(77,965)
Operating earnings (loss)			$	1,880,411					103,935						668						(108,424)						—						1,876,590
Corporate general and administrative expenses			—						—						—						—						105,207						105,207
Charitable foundation contribution			—						—						—						—						16,549						16,549
Earnings (loss) before income taxes			$	1,880,411					103,935						668						(108,424)						(121,756)						1,754,834

			Six Months Ended May 31, 2023
(In thousands)			Homebuilding						Financial Services						Multifamily						Lennar Other						Corporate						Total
Revenues:
Sales of homes			$	13,730,406					—						—						—						—						13,730,406
Sales of land			26,032						—						—						—						—						26,032
Other revenues			69,884						405,960						295,267						8,031						—						779,142
Total revenues			13,826,322						405,960						295,267						8,031						—						14,535,580
Costs and expenses:
Costs of homes sold			10,719,168						—						—						—						—						10,719,168
Costs of land sold			34,009						—						—						—						—						34,009
Selling, general and administrative expenses			960,494						—						—						—						—						960,494
Other costs and expenses			—						214,624						303,310						13,271						—						531,205
Total costs and expenses			11,713,671						214,624						303,310						13,271						—						12,244,876
Equity in loss from unconsolidated entities			(9,093)						—						(22,409)						(49,440)												(80,942)
Other income (expense), net and other gains (losses)			17,690						—						689						(5,019)												13,360
Lennar Other unrealized gains from technology investments			—						—						—						1,543												1,543
Operating earnings (loss)			$	2,121,248					191,336						(29,763)						(58,156)						—						2,224,665
Corporate general and administrative expenses			—						—						—						—						250,858						250,858
Charitable foundation contribution			—						—						—						—						30,733						30,733
Earnings (loss) before income taxes			$	2,121,248					191,336						(29,763)						(58,156)						(281,591)						1,943,074

			Six Months Ended May 31, 2022
(In thousands)			Homebuilding						Financial Services						Multifamily						Lennar Other						Corporate						Total
Revenues:
Sales of homes			$	13,685,440					—						—						—						—						13,685,440
Sales of land			31,491						—						—						—						—						31,491
Other revenues (1)			13,256						376,867						443,380						11,778						—						845,281
Total revenues			13,730,187						376,867						443,380						11,778						—						14,562,212
Homebuilding costs and expenses:
Costs of homes sold			9,795,647						—						—						—						—						9,795,647
Costs of land sold			36,371						—						—						—						—						36,371
Selling, general and administrative			915,033						—						—						—						—						915,033
Other costs and expenses			—						182,141						438,889						13,643						—						634,673
Total costs and expenses			10,747,051						182,141						438,889						13,643						—						11,381,724
Equity in earnings (loss) from unconsolidated entities			4,576						—						1,566						(27,701)						—						(21,559)
Other income (expense), net and other gains (losses)			2,549						—						38						(8,857)						—						(6,270)
Lennar Other unrealized losses from technology investments			—						—						—						(473,135)						—						(473,135)
Operating earnings			$	2,990,261					194,726						6,095						(511,558)						—						2,679,524
Corporate general and administrative expenses			—						—						—						—						218,868						218,868
Charitable foundation contribution			—						—						—						—						29,087						29,087
Earnings (loss) before income taxes			$	2,990,261					194,726						6,095						(511,558)						(247,955)						2,431,569

(1) During the six months ended May 31, 2022, other revenues in our Multifamily segment included land sales to unconsolidated entities of $147.8 million.

Three Months Ended May 31, 2023 versus Three Months Ended May 31, 2022

Revenues from home sales decreased 4% in the second quarter of 2023 to $7.6 billion from $8.0 billion in the second quarter of 2022. Revenues were lower primarily due to a 7% decrease in average sales price of home deliveries, partially offset by a 3% increase in the number of home deliveries. New home deliveries increased to 17,074 homes in the second quarter of 2023 from 16,549 homes second quarter of 2022. The average sales price of homes delivered was $449,000 in the second quarter of 2023, compared to $483,000 in the second quarter of 2022. The decrease in average sales price of homes delivered in the second quarter of 2023 compared to the same period last year was primarily due to pricing to market and product mix.

Gross margins on home sales were $1.7 billion, or 22.5%, in the second quarter of 2023, compared to $2.4 billion, or 29.5%, in the second quarter of 2022. During the second quarter of 2023, gross margin decreased because revenues per square foot decreased year over year as we priced homes to market and costs per square foot increased primarily due to higher materials and labor costs. In addition, land costs increased year over year.

Selling, general and administrative expenses were $510.7 million in the second quarter of 2023, compared to $486.6 million in the second quarter of 2022. As a percentage of revenues from home sales, selling, general and administrative expenses increased to 6.7% in the second quarter of 2023, from 6.1% in the second quarter of 2022, primarily due to an increase in the use of brokers in current market conditions.

During the three months ended May 31, 2023, our homebuilding operating earnings included an impairment of $36.8 million of an investment in a joint venture partially offset by $33.9 million of interest income due to the increase in our cash balances and higher interest rates.

Operating earnings for the Financial Services segment were $112.1 million, net of noncontrolling interests, in the second quarter of 2023, compared to $103.6 million in the second quarter of 2022. The increase in operating earnings was primarily due to a higher profit per locked loan in our mortgage business as a result of higher margins, partially offset by lower lock volume. There was also an increase in profitability in our title business primarily due to benefits of our technology efforts.

Operating loss for the Multifamily segment was $8.1 million in the second quarter of 2023, compared to operating earnings of $0.7 million in the second quarter of 2022. Operating loss for the Lennar Other segment was $18.4 million in the second quarter of 2023, compared to operating loss of $108.4 million in the second quarter of 2022. Lennar Other operating loss in the second quarter of 2023 was primarily related to operating losses from certain strategic investments, partially offset by the result of mark-to-market gains on our publicly traded technology investments. Lennar Other operating loss in the second quarter of 2022 was primarily due to mark-to-market losses on our technology investments.

Six Months Ended May 31, 2023 versus Six Months Ended May 31, 2022

Revenues from home sales were $13.7 billion in both the six months ended May 31, 2023 and 2022. Revenues were flat primarily because a 6% increase in the number of home deliveries was offset by a 5% decrease in average sales price of homes delivered. New home deliveries increased to 30,733 homes in the six months ended May 31, 2023 from 29,087 homes in the six months ended May 31, 2022. The average sales price of homes delivered was $449,000 in the six months ended May 31, 2023, compared to $472,000 in the six months ended May 31, 2022. The decrease in average sales price of homes delivered in the six months ended May 31, 2023 compared to the same period last year was primarily due to pricing to market and product mix.

Gross margins on home sales were $3.0 billion, or 21.9%, in the six months ended May 31, 2023, compared to $3.9 billion, or 28.4%, in the six months ended May 31, 2022. During the six months ended May 31, 2023, gross margin decreased because revenues per square foot decreased year over year as we priced homes to market and costs per square foot increased primarily due to higher materials and labor costs. In addition, land costs increased year over year.

Selling, general and administrative expenses were $960.5 million in the six months ended May 31, 2023, compared to $915.0 million in the six months ended May 31, 2022. As a percentage of revenues from home sales, selling, general and administrative expenses increased to 7.0% in the six months ended May 31, 2023, from 6.7% in the six months ended May 31, 2022.

During the six months ended May 31, 2023, our homebuilding operating earnings included an impairment of $36.8 million of an investment in a joint venture partially offset by $33.9 million of interest income due to an increase in cash balances and higher interest rates.

Operating earnings for the Financial Services segment were $191.3 million in the six months ended May 31, 2023, compared to $194.7 million in the six months ended May 31, 2022.

Operating loss for the Multifamily segment was $29.8 million in the six months ended May 31, 2023, compared to operating earnings of $6.1 million in the six months ended May 31, 2022. Operating loss for the Lennar Other segment was $58.2 million in the six months ended May 31, 2023, compared to operating loss of $511.6 million in the six months ended May 31, 2022. Lennar Other operating loss in the six months ended May 31, 2023 was primarily related to operating losses from certain strategic investments. Lennar Other operating loss in the six months ended May 31, 2022 was primarily due to mark-to-market losses on our publicly traded technology investments.

For the six months ended May 31, 2023 and 2022, we had a tax provision of $466.0 million and $599.7 million, respectively, which resulted in an overall effective income tax rate of 24.1% and 24.7%, respectively. In the six months ended May 31, 2023, our overall effective income tax rate was lower than last year primarily due to the reinstatement of the new energy efficient homes credit as a result of the enactment of the Inflation Reduction Act during the third quarter of 2022.

Homebuilding Segments

At May 31, 2023, our reportable Homebuilding segments and Homebuilding Other are outlined in Note 2 of the Notes to Condensed Consolidated Financial Statements. The following tables set forth selected financial and operational information related to our homebuilding operations for the periods indicated:

Selected Financial and Operational Data

			Three Months Ended May 31, 2023
			Gross Margins																		Operating Earnings (Loss)
($ in thousands)			Sales of Homes Revenue						Costs of Sales of Homes						Gross Margin %						Net Margins on Sales of Homes (1)						Gross Margins (Loss) on Sales of Land						Other Revenue						Equity in Earnings (Loss) from Unconsolidated Entities						Other Income (Expense), net						Operating Earnings (Loss)
East			$	2,318,431					1,638,651						29.3		%				508,830						554						4,130						3,110						(10,701)						505,923
Central			1,400,226						1,095,239						21.8		%				197,812						4,803						2,740						(915)						10,636						215,076
Texas			1,137,517						890,432						21.7		%				171,391						1,318						1,454						—						8,878						183,041
West			2,773,005						2,282,859						17.7		%				333,314						(2,293)						4,581						1,814						18,056						355,472
Other (2)			7,400						9,144						(23.6)		%				(1,793)						—						4,219						(16,288)						(31,241)						(45,103)
Totals			$	7,636,579					5,916,325						22.5		%				1,209,554						4,382						17,124						(12,279)						(4,372)						1,214,409

			Three Months Ended May 31, 2022
			Gross Margins																		Operating Earnings (Loss)
($ in thousands)			Sales of Homes Revenue						Costs of Sales of Homes						Gross Margin %						Net Margins on Sales of Homes (1)						Gross Margins (Loss) on Sales of Land						Other Revenue						Equity in Earnings (Loss) from Unconsolidated Entities						Other Income (Expense), net						Operating Earnings (Loss)
East			$	2,209,967					1,510,758						31.6		%				546,589						(619)						1,195						(659)						7,313						553,819
Central			1,283,763						981,832						23.5		%				206,893						—						226						302						(626)						206,795
Texas			1,093,533						747,861						31.6		%				272,934						473						255						—						(805)						272,857
West			3,367,261						2,360,554						29.9		%				846,340						(145)						678						2,571						(1,595)						847,849
Other (2)			9,159						9,778						(6.8)		%				(6,411)						—						4,421						2,648						(1,567)						(909)
Totals			$	7,963,683					5,610,783						29.5		%				1,866,345						(291)						6,775						4,862						2,720						1,880,411

			Six Months Ended May 31, 2023
			Gross Margins																		Operating Earnings (Loss)
($ in thousands)			Sales of Homes Revenue						Costs of Sales of Homes						Gross Margin %						Net Margins on Sales of Homes (1)						Gross Margins (Loss) on Sales of Land						Other Revenue						Equity in Earnings (Loss) from Unconsolidated Entities						Other Income (Expense), net						Operating Earnings (Loss)
East			$	4,176,479					2,970,129						28.9		%				882,462						(1,830)						24,293						6,358						18,836						930,119
Central			2,423,845						1,922,951						20.7		%				306,832						6,665						21,681						(227)						10,647						345,598
Texas			2,154,490						1,708,077						20.7		%				297,967						(733)						5,163						—						5,963						308,360
West			4,967,027						4,105,946						17.3		%				571,791						(12,079)						10,485						1,662						14,113						585,972
Other (2)			8,565						12,065						(40.9)		%				(8,308)						—						8,262						(16,886)						(31,869)						(48,801)
Totals			$	13,730,406					10,719,168						21.9		%				2,050,744						(7,977)						69,884						(9,093)						17,690						2,121,248

			Six Months Ended May 31, 2022
			Gross Margins																		Operating Earnings (Loss)
($ in thousands)			Sales of Homes Revenue						Costs of Sales of Homes						Gross Margin %						Net Margins on Sales of Homes (1)						Gross Margins (Loss) on Sales of Land						Other Revenue						Equity in Earnings (Loss) from Unconsolidated Entities						Other Income (Expense), net						Operating Earnings (Loss)
East			$	3,872,958					2,687,311						30.6		%				898,143						(6,293)						1,992						(2,017)						13,989						905,814
Central			2,389,693						1,852,445						22.5		%				357,268						1,619						460						431						(905)						358,873
Texas			1,899,163						1,321,703						30.4		%				442,875						2,871						497						—						(2,074)						444,169
West			5,509,465						3,918,290						28.9		%				1,290,864						(984)						1,559						2,707						(4,849)						1,289,297
Other (2)			14,161						15,898						(12.3)		%				(14,390)						(2,093)						8,748						3,455						(3,612)						(7,892)
Totals			$	13,685,440					9,795,647						28.4		%				2,974,760						(4,880)						13,256						4,576						2,549						2,990,261

(1)Net margins on sales of homes include selling, general and administrative expenses.

(2)Negative gross and net margins were due to period costs and impairments in Urban divisions that impact costs of homes sold without sufficient sales of homes revenue to offset those costs.

Summary of Homebuilding Data

Deliveries:

			Three Months Ended
			Homes												Dollar Value (In thousands)												Average Sales Price
			May 31,												May 31,												May 31,
			2023						2022						2023						2022						2023						2022
East			5,372						5,198						$	2,349,348					2,225,725						$	437,000					428,000
Central			3,220						2,944						1,400,226						1,283,763						435,000						436,000
Texas			3,908						3,288						1,137,517						1,093,533						291,000						333,000
West			4,565						5,110						2,773,005						3,367,261						607,000						659,000
Other			9						9						7,401						9,159						822,000						1,018,000
Total			17,074						16,549						$	7,667,497					7,979,441						$	449,000					483,000

Of the total homes delivered listed above, 72 homes with a dollar value of $30.9 million and an average sales price of $429,000 represent home deliveries from unconsolidated entities for the three months ended May 31, 2023, compared to 44 home deliveries with a dollar value of $15.8 million and an average sales price of $358,000 for the three months ended May 31, 2022.

			Six Months Ended
			Homes												Dollar Value (In thousands)												Average Sales Price
			May 31,												May 31,												May 31,
			2023						2022						2023						2022						2023						2022
East			9,667						9,280						$	4,239,069					3,898,097						$	439,000					420,000
Central			5,520						5,465						2,423,845						2,389,692						439,000						437,000
Texas			7,329						5,825						2,154,490						1,899,163						294,000						326,000
West			8,207						8,502						4,967,027						5,509,465						605,000						648,000
Other			10						15						8,566						14,161						857,000						944,000
Total			30,733						29,087						$	13,792,997					13,710,578						$	449,000					472,000

Of the total homes delivered listed above, 135 homes with a dollar value of $62.6 million and an average sales price of $464,000 represent home deliveries from unconsolidated entities for the six months ended May 31, 2023, compared to 69 home deliveries with a dollar value of $25.1 million and an average sales price of $364,000 for the six months ended May 31, 2022.

Sales Incentives (1):

															Three Months Ended
									Average Sales Incentives Per Home Delivered												Sales Incentives as a % of Revenue
									May 31,												May 31,
															2023						2022						2023						2022
East															$	30,900					5,600						6.6		%				1.3		%
Central															28,600						5,100						6.2		%				1.1		%
Texas															57,600						12,000						16.5		%				3.5		%
West															47,300						6,700						7.2		%				1.0		%
Other															101,800						103,200						11.0		%				9.2		%
Total															$	41,000					7,200						8.4		%				1.5		%

															Six Months Ended
									Average Sales Incentives Per Home Delivered												Sales Incentives as a % of Revenue
									May 31,												May 31,
															2023						2022						2023						2022
East															$	31,500					6,100						6.7		%				1.4		%
Central															32,700						6,000						6.9		%				1.4		%
Texas															62,200						12,800						17.5		%				3.8		%
West															54,700						7,300						8.3		%				1.1		%
Other															100,200						95,200						10.5		%				9.2		%
Total															$	45,300					7,800						9.2		%				1.6		%

(1) Sales incentives relate to home deliveries during the period, excluding deliveries by unconsolidated entities.

New Orders (2):

			Three Months Ended
			Active Communities												Homes												Dollar Value (In thousands)												Average Sales Price
			May 31,												May 31,												May 31,												May 31,
			2023						2022						2023						2022						2023						2022						2023						2022
East			370						354						5,484						5,973						$	2,356,554					2,753,770						$	430,000					461,000
Central			299						315						3,618						3,576						1,539,430						1,663,354						425,000						465,000
Texas			226						205						3,732						3,375						1,079,757						1,189,263						289,000						352,000
West			365						348						5,045						4,858						3,190,159						3,482,679						632,000						717,000
Other			3						3						6						10						5,544						9,203						924,000						920,000
Total			1,263						1,225						17,885						17,792						$	8,171,444					9,098,269						$	457,000					511,000

Of the total homes listed above, 73 homes with a dollar value of $37.0 million and an average sales price of $507,000 represent homes in seven active communities from unconsolidated entities for the three months ended May 31, 2023, compared to 60 homes with a dollar value of $30.8 million and an average sales price of $514,000 in seven active communities for the three months ended May 31, 2022.

			Six Months Ended
			Homes												Dollar Value (In thousands)												Average Sales Price
			May 31,												May 31,												May 31,
			2023						2022						2023						2022						2023						2022
East			9,761						10,883						$	4,208,450					4,886,826						$	431,000					449,000
Central			5,923						6,688						2,509,528						3,065,492						424,000						458,000
Texas			6,874						6,141						1,959,213						2,111,048						285,000						344,000
West			9,510						9,812						5,898,485						6,818,611						620,000						695,000
Other			11						15						9,229						13,831						839,000						922,000
Total			32,079						33,539						$	14,584,905					16,895,808						$	455,000					504,000

Of the total homes delivered listed above, 170 homes with a dollar value of $75.2 million and an average sales price of $443,000 represent home deliveries from unconsolidated entities for the six months ended May 31, 2023, compared to 104 home deliveries with a dollar value of $48.2 million and an average sales price of $463,000 for the six months ended May 31, 2022.

(2)Homes represent the number of new sales contracts executed with homebuyers, net of cancellations, during the three and six months ended May 31, 2023 and 2022.

We experienced cancellation rates in our Homebuilding segments and Homebuilding other as follows:

			Three Months Ended												Six Months Ended
			May 31,												May 31,
			2023						2022						2023						2022
East			13		%				7		%				18		%				7		%
Central			11		%				7		%				19		%				7		%
Texas			19		%				21		%				21		%				20		%
West			12		%				14		%				13		%				12		%
Other			14		%				—		%				15		%				56		%
Total			14		%				12		%				17		%				11		%

Backlog:

			At
			Homes												Dollar Value (In thousands)												Average Sales Price
			May 31,												May 31,												May 31,
			2023						2022						2023						2022						2023						2022
East			8,799						9,882						$	3,789,706					4,566,295						$	431,000					462,000
Central			4,428						6,381						1,941,113						3,010,596						438,000						472,000
Texas			2,242						4,582						641,806						1,665,155						286,000						363,000
West			4,743						7,775						3,157,935						5,444,307						666,000						700,000
Other			2						4						1,828						3,611						914,000						903,000
Total			20,214						28,624						$	9,532,388					14,689,964						$	472,000					513,000

Of the total homes in backlog listed above, 201 homes with a backlog dollar value of $90.4 million and an average sales price of $450,000 represent the backlog from unconsolidated entities at May 31, 2023, compared to 114 homes with a backlog dollar value of $51.7 million and an average sales price of $453,000 at May 31, 2022.

Backlog represents the number of homes under sales contracts. Homes are sold using sales contracts, which are generally accompanied by sales deposits. In some instances, purchasers are permitted to cancel sales if they fail to qualify for financing or under certain other circumstances. Various state and federal laws and regulations may sometimes give purchasers a right to cancel homes in backlog. We do not recognize revenue on homes under sales contracts until the sales are closed and title passes to the new homeowners.

Three Months Ended May 31, 2023 versus Three Months Ended May 31, 2022

Homebuilding East: Revenues from home sales increased in the second quarter of 2023 compared to the second quarter of 2022, primarily due to an increase in the number of home deliveries in all the states in the segment except in New Jersey and South Carolina and an increase in the average sales price of homes delivered in all the states in the segment except in Alabama. The increase in the number of home deliveries was primarily due to an increase in the number of deliveries per active community. The decrease in the number of home deliveries in New Jersey and South Carolina was primarily due to a decrease in the number of active communities due to the timing of opening and closing of communities. The increase in the average sales price of homes delivered in all the states in the segment except in Alabama was primarily due to product mix. The decrease in the average sales price of homes delivered in Alabama was primarily due to pricing to market and product mix. In the second quarter of 2023, an increase in revenues per square foot was more than offset by an increase in costs per square foot primarily due to higher materials and labor costs, thus gross margin percentage of home deliveries decreased. In addition, land costs increased year over year.

Homebuilding Central: Revenues from home sales increased in the second quarter of 2023 compared to the second quarter of 2022, primarily due to an increase in the number of home deliveries in all the states in the segment except in Georgia, Maryland, Tennessee and Virginia while the average sales price of homes delivered decreased in all the states in the segment except in Georgia, Illinois, Indiana, Maryland and Tennessee. The increase in the number of home deliveries in Illinois, Indiana, Minnesota and North Carolina was primarily due to an increase in the number of deliveries per active community. The decrease in the number of home deliveries in other states of the segment was primarily due to a decrease in the number of deliveries per active community due to the timing of opening and closing of communities. The increase in the average sales price of homes delivered in Georgia, Illinois, Indiana, Maryland, and Tennessee was primarily due to product mix. The decrease in the average sales price of homes delivered in other states of the segment was primarily due to pricing to market and product mix. In the second quarter of 2023, a decrease in revenues per square foot and an increase in costs per square foot primarily due to higher materials and labor costs, resulted in a decrease in gross margin percentage of home deliveries. In addition, land costs remained relatively flat year over year.

Homebuilding Texas: Revenues from home sales increased in the second quarter of 2023 compared to the second quarter of 2022, primarily due to an increase in the number of home deliveries which was partially offset by a decrease in the average sales price of homes delivered. The increase in the number of home deliveries was primarily due to an increase in the number of deliveries per active community. The decrease in the average sales price of homes delivered was primarily due to pricing to market. In the second quarter of 2023, a decrease in revenues per square foot and an increase in costs per square foot primarily due to higher materials and labor costs, resulted in a decrease in gross margin percentage of home deliveries. In addition, land costs remained relatively flat year over year.

Homebuilding West: Revenues from home sales decreased in the second quarter of 2023 compared to the second quarter of 2022, primarily due to a decrease in the number of home deliveries in all the states in the segment except in Arizona, Idaho and Oregon and a decrease in the average sales price of homes delivered in all the states in the segment. The increase in the number of home deliveries in Arizona, Idaho and Oregon was primarily due to an increase in the number of deliveries per active community. The decrease in the number of home deliveries in other states of the segment was primarily due to a decrease in the number of deliveries per active community due to the timing of opening and closing of communities. The decrease in the average sales price of homes delivered in all the states of the segment was primarily due to pricing to market and product mix. In the second quarter of 2023, a decrease in revenues per square foot and an increase in costs per square foot primarily due to higher materials and labor costs, resulted in a decrease in gross margin percentage of home deliveries. In addition, land costs increased year over year.

Six Months Ended May 31, 2023 versus Six Months Ended May 31, 2022

Homebuilding East: Revenues from home sales increased in the six months ended May 31, 2023 compared to the six months ended May 31, 2022, primarily due to an increase in the number of home deliveries in all the states in the segment except in New Jersey and South Carolina and an increase in the average sales price of homes delivered in all the states in the segment. The increase in the number of home deliveries was primarily due to an increase in the number of deliveries per active community. The decrease in the number of home deliveries in New Jersey and South Carolina was primarily due to a decrease in the number of deliveries per active community due to the timing of opening and closing of communities. The increase in the average sales price of homes delivered was primarily due to product mix. In the six months ended May 31, 2023, an increase in

revenues per square foot was more than offset by an increase in costs per square foot primarily due to higher materials and labor costs, thus gross margin percentage of home deliveries decreased. In addition, land costs increased year over year.

Homebuilding Central: Revenues from home sales increased in the six months ended May 31, 2023 compared to the six months ended May 31, 2022, primarily due to an increase in the number of home deliveries in all the states in the segment except in Georgia, Maryland, Minnesota, Tennessee and Virginia and an increase in the average sales price of homes delivered in all the states in the segment except in Minnesota, North Carolina and Virginia. The increase in the number of home deliveries in Illinois, Indiana and North Carolina was primarily due to an increase in the number of deliveries per active community. The decrease in the number of home deliveries in other states of the segment was primarily due to a decrease in the number of deliveries per active community due to the timing of opening and closing of communities. The increase in the average sales price of homes delivered in Georgia, Illinois, Indiana, Maryland, Tennessee was primarily due to product mix. The decrease in the average sales price of homes delivered in other states of the segment was primarily due to pricing to market and product mix. In the six months ended May 31, 2023, a decrease in revenues per square foot and an increase in costs per square foot primarily due to higher materials and labor costs, resulted in a decrease in gross margin percentage of home deliveries. In addition, land costs remained relatively flat year over year.

Homebuilding Texas: Revenues from home sales increased in the six months ended May 31, 2023, compared to the six months ended May 31, 2022, primarily due to an increase in the number of home deliveries which was partially offset by a decrease in the average sales price of homes delivered. The increase in the number of home deliveries was primarily due to an increase in the number of deliveries per active community. The decrease in the average sales price of homes delivered was primarily due to pricing to market. In the six months ended May 31, 2023, a decrease in revenues per square foot and an increase in costs per square foot primarily due to higher materials and labor costs, resulted in a decrease in gross margin percentage of home deliveries. In addition, land costs remained relatively flat year over year.

Homebuilding West: Revenues from home sales decreased in the six months ended May 31, 2023 compared to the six months ended May 31, 2022, primarily due to a decrease in the number of home deliveries in all the states in the segment except in Arizona, Idaho, Nevada and Oregon and a decrease in the average sales price of homes delivered in all the states in the segment. The increase in the number of home deliveries in Arizona, Idaho, Nevada and Oregon was primarily due to an increase in the number of deliveries per active community. The decrease in the number of home deliveries in other states of the segment was primarily due to a decrease in the number of deliveries per active community due to the timing of opening and closing of communities. The decrease in the average sales price of homes delivered in all the states of the segment was primarily due to pricing to market and product mix. In the six months ended May 31, 2023, a decrease in revenues per square foot and an increase in costs per square foot primarily due to higher materials and labor costs, resulted in a decrease in gross margin percentage of home deliveries. In addition, land costs increased year over year.

Financial Services Segment

Our Financial Services reportable segment provides mortgage financing, title and closing services primarily for buyers of our homes. The segment also originates and sells into securitizations commercial mortgage loans through its LMF Commercial business. Our Financial Services segment sells substantially all of the residential loans it originates within a short period in the secondary mortgage market, the majority of which are sold on a servicing released, non-recourse basis. After the loans are sold, we retain potential liability for possible claims by purchasers that we breached certain limited industry-standard representations and warranties in the loan sale agreements.

The following table sets forth selected financial and operational information related to the residential mortgage and title activities of our Financial Services segment:

			Three Months Ended												Six Months Ended
			May 31,												May 31,
(Dollars in thousands)			2023						2022						2023						2022
Dollar value of mortgages originated			$	3,942,000					3,507,000						7,096,000						6,267,000
Number of mortgages originated			10,700						9,200						19,200						16,500
Mortgage capture rate of Lennar homebuyers			79%						69%						78%						71%
Number of title and closing service transactions			17,600						17,400						31,900						31,100

At May 31, 2023 and November 30, 2022, the carrying value of Financial Services' commercial mortgage-backed securities was $141.4 million and $143.3 million, respectively. Details of these securities and related debt are within Note 2 of the Notes to Condensed Consolidated Financial Statements.

Multifamily Segment

We have been actively involved, primarily through unconsolidated funds and joint ventures, in the development, construction and property management of multifamily rental properties. Our Multifamily segment focuses on developing a geographically diversified portfolio of institutional quality multifamily rental properties in select U.S. markets.

The following table provides information related to our investment in the Multifamily segment:

Balance Sheets
(In thousands)			May 31, 2023						November 30, 2022
Multifamily investments in unconsolidated entities			$	629,649					648,126
Lennar's net investment in Multifamily			1,003,069						935,961

Lennar Other Segment

Lennar Other primarily includes strategic investments in technology companies, primarily managed by our LENX subsidiary, and fund interests we retained when we sold the Rialto Capital Management ("Rialto") asset and investment management platform in 2018. At May 31, 2023 and November 30, 2022, we had $791.4 million and $788.5 million, respectively, of assets in our Lennar Other segment, which included investments in unconsolidated entities of $292.1 million and $316.5 million, respectively. The investments in equity securities of Blend Labs, Inc. ("Blend Labs"), Hippo Holdings, Inc. ("Hippo"), Opendoor, Inc. ("Opendoor"), SmartRent, Inc. ("SmartRent"), Sonder Holdings, Inc. ("Sonder"), and Sunnova Energy International, Inc. ("Sunnova") are carried at market and will therefore change depending on the market value of our shareholdings in those entities on the last day of each quarter. The following is a detail of Lennar Other unrealized gains (losses) from mark-to-market adjustments on our technology investments:

			Three Months Ended												Six Months Ended
			May 31,												May 31,
(In thousands)			2023						2022						2023						2022
Blend Labs (BLND)			$	(1,332)					(13,550)						(746)						(20,992)
Hippo (HIPO)			(4,399)						(37,946)						2,233						(162,403)
Opendoor (OPEN)			22,512						(20,999)						14,821						(164,360)
SmartRent (SMRT)			8,621						(3,950)						9,926						(48,313)
Sonder (SOND)			(138)						(1,626)						(458)						(2,132)
Sunnova (NOVA)			233						106						(24,233)						(74,935)
Lennar Other unrealized gains (losses) from technology investments			$	25,497					(77,965)						1,543						(473,135)

(2) Financial Condition and Capital Resources

At May 31, 2023, we had cash and cash equivalents and restricted cash related to our homebuilding, financial services, multifamily and other operations of $4.3 billion, compared to $4.8 billion at November 30, 2022 and $1.6 billion at May 31, 2022.

We finance all of our activities, including homebuilding, financial services, multifamily, other and general operating needs, primarily with cash generated from our operations, debt issuances and cash borrowed under our warehouse lines of credit and our unsecured revolving credit facility (the "Credit Facility"). At May 31, 2023, we had $4.0 billion of homebuilding cash and cash equivalents and no outstanding borrowings under our $2.6 billion revolving credit facility, thereby providing approximately $6.6 billion of available capacity.

Operating Cash Flow Activities

During the six months ended May 31, 2023 and 2022, cash provided by operating activities totaled $1.6 billion and $53 million, respectively. During the six months ended May 31, 2023, cash provided by operating activities was impacted primarily by our net earnings, a decrease in loans held-for-sale of $578 million primarily related to the sale of loans originated by our Financial Services segment and a decrease in receivables of $436 million primarily related to a decrease in Financial Services receivables, net, which are loans sold to investors for which we have not yet been paid. This was partially offset by a decrease in accounts payable and other liabilities of $991 million, primarily due to the payment of income taxes.

During the six months ended May 31, 2022, cash provided by operating activities was impacted primarily by our net earnings, excluding Lennar Other mark-to-market losses on our publicly trade technology investments and other losses of $483 million, a decrease in loans held-for-sale of $336 million primarily related to the sale of loans originated by our Financial Services segment, an increase in accounts payable and other liabilities of $277 million and a decrease in receivables of $126 million primarily related to a decrease in Financial Services' receivables, net, which are loans sold to investors for which we have not been paid. This was partially offset by an increase in inventories due to strategic land purchases, land development and construction costs of $3.1 billion.

Investing Cash Flow Activities

During the six months ended May 31, 2023 and 2022, cash used in investing activities totaled $81 million and $65 million, respectively. During the six months ended May 31, 2023, our cash used in investing activities was primarily due to cash contributions of $108 million to unconsolidated entities, which included (1) $54 million to Homebuilding unconsolidated entities, (2) $40 million to Lennar other unconsolidated entities and (3) $14 million to Multifamily unconsolidated entities. This was partially offset by distributions of capital from unconsolidated entities of $46 million, which primarily included (1) $33 million from Homebuilding unconsolidated entities, and (2) $13 million from our Lennar Other unconsolidated entities.

During the six months ended May 31, 2022, our cash used in investing activities was primarily due to cash contributions of $261 million to unconsolidated entities, which included (1) $197 million to Homebuilding unconsolidated entities, (2) $53 million to Lennar Other unconsolidated entities, and (3) $11 million to Multifamily unconsolidated entities. In addition, we also had $79 million of purchases of investment securities related to our publicly traded technology investments included in the Lennar Other segment. This was partially offset by distributions of capital from unconsolidated entities of $239 million, which primarily included (1) $156 million from Multifamily unconsolidated entities, (2) $67 million from Homebuilding unconsolidated entities, and (3) $16 million from our Lennar Other unconsolidated entities.

Financing Cash Flow Activities

During the six months ended May 31, 2023 and 2022, cash used in financing activities totaled $2.1 billion and $1.4 billion, respectively. During the six months ended May 31, 2023, cash used in financing activities was primarily due to (1) $978 million of net repayments under our Financial Services' warehouse facilities; (2) $465 million of repurchases of our common stock, which included $401 million of repurchases under our repurchase program and $64 million of repurchases related to our equity compensation plan; (3) $158 million of repurchases of senior notes due in fiscal year 2024; (4) $218 million of dividend payments; and (5) $186 million of net payments from liabilities related to consolidated inventory not owned due to activity with land banks.

During the six months ended May 31, 2022, cash used in financing activities was primarily due to (1) $404 million of net repayments under our Financial Services' warehouse facilities, which included the LMF Commercial warehouse repurchase facilities; (2) $906 million of repurchases of our common stock, which included $847 million of repurchases under our repurchase program and $58 million of repurchases related to our equity compensation plan; and (3) $221 million of dividend payments. These were partially offset by $210 million of net proceeds from liabilities related to consolidated inventory not owned due to activity with land banks.

Debt to total capital ratios are financial measures commonly used in the homebuilding industry and are presented to assist in understanding the leverage of our homebuilding operations. Homebuilding debt to total capital and net Homebuilding debt to total capital are calculated as follows:

(Dollars in thousands)			May 31, 2023						November 30, 2022						May 31, 2022
Homebuilding debt			$	3,852,258					4,047,294						4,645,791
Stockholders’ equity			25,015,145						24,100,500						21,598,255
Total capital			$	28,867,403					28,147,794						26,244,046
Homebuilding debt to total capital			13.3		%				14.4		%				17.7		%
Homebuilding debt			$	3,852,258					4,047,294						4,645,791
Less: Homebuilding cash and cash equivalents			4,004,679						4,616,124						1,314,741
Net Homebuilding debt			$	(152,421)					(568,830)						3,331,050
Net Homebuilding debt to total capital (1)			(0.6)		%				(2.4)		%				13.4		%

(1)Net homebuilding debt to total capital is a non-GAAP financial measure defined as net homebuilding debt (homebuilding debt less homebuilding cash and cash equivalents) divided by total capital (net homebuilding debt plus stockholders' equity). We believe the ratio of net homebuilding debt to total capital is a relevant and a useful financial measure to investors in understanding the leverage employed in homebuilding operations. However, because net homebuilding debt to total capital is not calculated in accordance with GAAP, this financial measure should not be considered in isolation or as an alternative to financial measures prescribed by GAAP. Rather, this non-GAAP financial measure should be used to supplement our GAAP results.

At May 31, 2023, Homebuilding debt to total capital was lower compared to both November 30, 2022 and May 31, 2022, primarily as a result of an increase in stockholders' equity due to net earnings and a decrease in homebuilding debt due to debt paydowns and debt repurchases, partially offset by share repurchases.

We are continually exploring various types of transactions to manage our leverage and liquidity positions, take advantage of market opportunities and increase our revenues and earnings. These transactions may include the issuance of additional indebtedness, the repurchase of our outstanding indebtedness, the repurchase of our common stock, the acquisition of homebuilders and other companies, the purchase or sale of assets or lines of business, the issuance of common stock or securities convertible into shares of common stock, and/or the pursuit of other financing alternatives. In connection with some

of our non-homebuilding businesses, we are also considering other types of transactions such as sales, restructurings, joint ventures, spin-offs or initial public offerings as we continue to move back towards being a pure play homebuilding company.

Subject to market conditions, we intend to spin off our Multifamily and single family home for rent asset management businesses, together with some investment assets, by transferring them to a newly formed subsidiary, Quarterra Group, Inc. ("Quarterra"), and distributing the stock of that subsidiary to our stockholders. That would make us more of a pure homebuilding and financial services company. At this time, we have deferred this transaction due to market conditions.

Our Homebuilding senior notes and other debts payable as well as letters of credit and surety bonds are summarized within Note 7 of the Notes to Condensed Consolidated Financial Statements. Our Homebuilding average debt outstanding and the average rates of interest was as follows:

			Six Months Ended
			May 31,
(Dollars in thousands)			2023						2022
Homebuilding average debt outstanding			$	4,010,108					$	5,087,360
Average interest rate			4.9%						4.6%
Interest incurred			$	99,281					121,732

The maximum available borrowings on our unsecured revolving credit facility (the "Credit Facility") were as follows:

(In thousands)						May 31, 2023
Commitments - maturing in April 2024						$	350,000
Commitments - maturing in May 2027						2,225,000
Total commitment						$	2,575,000
Accordion feature						425,000
Total maximum borrowings capacity						$	3,000,000

The proceeds available under the Credit Facility, which are subject to specified conditions for borrowing, may be used for working capital and general corporate purposes. The Credit Facility also provides that up to $500 million in commitments may be used for letters of credit. The maturity, debt covenants and details of the Credit Facility are unchanged from the disclosure in our Financial Condition and Capital Resources section in our Annual Report on Form 10-K for the fiscal year ended November 30, 2022. In addition to the Credit Facility, we have other letter of credit facilities with different financial institutions.

Under our Credit Facility agreement, we are required to maintain a minimum consolidated tangible net worth, a maximum leverage ratio and either a liquidity or an interest coverage ratio. These ratios are calculated per the Credit Facility agreement, which involves adjustments to GAAP financial measures. We believe we were in compliance with our debt covenants as of May 31, 2023. The following summarizes our debt covenant requirements and our actual levels or ratios with respect to those covenants as calculated per the Credit Facility agreement as of May 31, 2023:

(Dollars in thousands)			Covenant Level						Level Achieved as of May 31, 2023
Minimum net worth test			$	12,853,382					18,674,331
Maximum leverage ratio			65.0%						0.8%
Liquidity test			1.00						48.11

Financial Services Warehouse Facilities

Our Financial Services segment uses residential mortgage loan warehouse facilities to finance its residential lending activities until the mortgage loans are sold to investors and the proceeds are collected. The facilities are non-recourse to us and are expected to be renewed or replaced with other facilities when they mature. The LMF Commercial facilities finance LMF Commercial loan origination and securitization activities and were secured by up to 80% interests in the originated commercial loans financed. These facilities and the related borrowings and collateral are detailed in Note 2 of the Notes to Condensed Consolidated Financial Statements.

Changes in Capital Structure

In March 2022, our Board of Directors approved an authorization for us to repurchase up to the lesser of $2 billion in value, or 30 million in shares, of our outstanding Class A or Class B common stock. The repurchase authorization has no expiration date. This authorization was in addition to what was remaining of our October 2021 stock repurchase program. The details of our Class A and Class B common stock repurchases under the authorized repurchase programs for the six months ended May 31, 2023 and 2022 are included in Note 4 of the Notes to Condensed Consolidated Financial Statements.

During the six months ended May 31, 2023, treasury shares increased by 4.7 million shares primarily due to our repurchase of 4.0 million shares of Class A and Class B common stock through our stock repurchase program. During the six

months ended May 31, 2022, treasury shares decreased due to our retirement of 46.7 million and 2.8 million treasury shares of Class A and Class B common stock, respectively, as authorized by our Board of Directors. The retirement of Class A and Class B common stock in treasury resulted in a reclass between treasury shares and additional paid-in capital within stockholders' equity. This decrease in treasury shares was partially offset by our repurchase of 8.2 million and 1.1 million shares of Class A and Class B common stock, respectively, through our stock repurchase program.

On June 22, 2023, our Board of Directors declared a quarterly cash dividend of $0.375 per share on both our Class A and Class B common stock, payable on July 21, 2023 to holders of record at the close of business on July 7, 2023. On May 10, 2023, we paid cash dividends of $0.375 per share on both our Class A and Class B common stock to holders of record at the close of business on April 26, 2023, as declared by our Board of Directors on April 12, 2023. We approved and paid cash dividends of $0.375 per share for each of the four quarters of 2022 on both our Class A and Class B common stock.

Based on our current financial condition and credit relationships, we believe that our operations and borrowing resources will provide for our current and long-term capital requirements at our anticipated levels of activity.

Supplemental Financial Information

Currently, certain of our 100% owned subsidiaries, which are primarily homebuilding subsidiaries, are guaranteeing all our senior notes. The guarantees are full and unconditional.

The indentures governing our senior notes require that, if any of our 100% owned subsidiaries, other than our finance company subsidiaries and foreign subsidiaries, directly or indirectly guarantee at least $75 million principal amount of debt of Lennar Corporation (other than senior notes), those subsidiaries must also guarantee Lennar Corporation’s obligations with regard to its senior notes. Included in the following tables as part of “Obligors” together with Lennar Corporation are subsidiary entities that are not finance company subsidiaries or foreign subsidiaries and were guaranteeing the senior notes because at May 31, 2023 they were guaranteeing Lennar Corporation's letter of credit facilities and its Credit Facility, disclosed in Note 7 of the Notes to Condensed Consolidated Financial Statements. The guarantees are full, unconditional and joint and several and the guarantor subsidiaries are 100% directly or indirectly owned by Lennar Corporation. A subsidiary's guarantee of Lennar senior notes will be suspended at any time when it is not directly or indirectly guaranteeing at least $75 million principal amount of debt of Lennar Corporation (other than senior notes), and a subsidiary will be released from its guarantee and any other obligations it may have regarding the senior notes if all or substantially all its assets, or all of its capital stock, are sold or otherwise disposed.

Supplemental information for the Obligors, which excludes non-guarantor subsidiaries and intercompany transactions, at May 31, 2023 is included in the following tables. Intercompany balances and transactions within the Obligors have been eliminated and amounts attributable to the Obligors' investment in consolidated subsidiaries that have not issued or guaranteed the senior notes have been excluded. Amounts due from and transactions with nonobligor subsidiaries and related parties are separately disclosed:

(In thousands)			May 31, 2023						November 30, 2022
Due from non-guarantor subsidiaries			$	19,612,429					17,959,091
Equity method investments			1,002,316						1,090,831
Total assets			42,229,274						40,929,435
Total liabilities			9,485,998						10,455,359

			Six Months Ended
(In thousands)			May 31, 2023
Total revenues			$	13,665,442
Operating earnings			2,077,023
Earnings before income taxes			1,801,060
Net earnings attributable to Lennar			1,366,664

Off-Balance Sheet Arrangements

We regularly monitor the results of our Homebuilding, Multifamily and Lennar Other unconsolidated joint ventures and any trends that may affect their future liquidity or results of operations. We also monitor the performance of joint ventures in which we have investments on a regular basis to assess compliance with debt covenants. For those joint ventures not in compliance with the debt covenants, we evaluate and assess possible impairment of our investments. We believe all of the joint ventures were in compliance with applicable debt covenants at May 31, 2023.

Homebuilding: Investments in Unconsolidated Entities

As of May 31, 2023, we had equity investments in 48 active homebuilding and land unconsolidated entities (of which 4 had recourse debt, 15 had non-recourse debt and 29 had no debt) and 48 active homebuilding and land unconsolidated entities

at November 30, 2022. Historically, we have invested in unconsolidated entities that acquired and developed land (1) for our homebuilding operations or for sale to third parties or (2) for the construction of homes for sale to third-party homebuyers. Through these entities, we have primarily sought to reduce and share our risk by limiting the amount of our capital invested in land, while obtaining access to potential future homesites and allowing us to participate in strategic ventures. The use of these entities also, in some instances, has enabled us to acquire land to which we could not otherwise obtain access, or could not obtain access on as favorable terms, without the participation of a strategic partner. Participants in these joint ventures have been land owners/developers, other homebuilders and financial or strategic partners. Joint ventures with land owners/developers have given us access to homesites owned or controlled by our partners. Joint ventures with other homebuilders have provided us with the ability to bid jointly with our partners for large land parcels. Joint ventures with financial partners have allowed us to combine our homebuilding expertise with access to our partners’ capital. Joint ventures with strategic partners have allowed us to combine our homebuilding expertise with the specific expertise (e.g. commercial or infill experience) of our partners. Each joint venture is governed by an executive committee consisting of members from the partners. Details regarding these investments, balances and debt are included in Note 3 of the Notes to Condensed Consolidated Financial Statements.

The following table summarizes the principal maturities of our Homebuilding unconsolidated entities ("JVs") debt as per current debt arrangements as of May 31, 2023. It does not represent estimates of future cash payments that will be made to reduce debt balances. Many JV loans have extension options in the loan agreements that would allow the loans to be extended into future years.

									Principal Maturities of Unconsolidated JVs by Period
(In thousands)									Total JV Debt						2023						2024						2025						Thereafter						Other
Bank debt without recourse to Lennar									$	1,358,757					122,008						385,674						734,563						116,512						—
Land seller and other debt without recourse to Lennar									11,349						—						—						—						11,349						—
Maximum recourse debt exposure to Lennar									9,770						—						—						—						9,770						—
Debt issuance costs									(16,278)						—						—						—						—						(16,278)
Total									$	1,363,598					122,008						385,674						734,563						137,631						(16,278)

We own an approximately 40% interest in FivePoint Holdings, LLC., a NYSE listed company, and companies it manages, which own three large multi-use properties in California.

We manage, and have an investment in, Upward America Fund, which purchases single family homes and operates them as rental properties.

Multifamily: Investments in Unconsolidated Entities

At May 31, 2023, Multifamily had equity investments in 23 active unconsolidated entities that are engaged in multifamily residential developments (of which 19 had non-recourse debt and 4 had no debt) and 23 active unconsolidated entities at November 30, 2022. We invest in unconsolidated entities that acquire and develop land to construct multifamily rental properties. Through these entities, we are focusing on developing a geographically diversified portfolio of institutional quality multifamily rental properties in select U.S. markets. Initially, we participated in building multifamily developments and selling them soon after they were completed. Participants in these joint ventures have been financial partners. Joint ventures with financial partners have allowed us to combine our development and construction expertise with access to our partners’ capital. Each joint venture is governed by an operating agreement that provides significant substantive participating voting rights on major decisions to our partners.

The Multifamily segment includes LMV I, LMV II and Canada Pension Plan Investments Fund, which are long-term multifamily development investment vehicles involved in the development, construction and property management of class-A multifamily assets. Details of each as of and during the six months ended May 31, 2023 are included in Note 3 of the Notes to Condensed Consolidated Financial Statements.

The following table summarizes the principal maturities of our Multifamily unconsolidated entities debt as per current debt arrangements as of May 31, 2023. It does not represent estimates of future cash payments that will be made to reduce debt balances.

									Principal Maturities of Unconsolidated JVs by Period
(In thousands)									Total JV Debt						2023						2024						2025						Thereafter						Other
Debt without recourse to Lennar									$	4,652,220					829,721						1,431,615						1,237,832						1,153,052						—
Debt issuance costs									(23,135)						—						—						—						—						(23,135)
Total									$	4,629,085					829,721						1,431,615						1,237,832						1,153,052						(23,135)

Lennar Other: Investments in Unconsolidated Entities

As part of the sale of the Rialto investment and asset management platform in 2018, we retained our ability to receive a portion of payments with regard to carried interests if certain funds meet specified performance thresholds. We periodically

receive advance distributions related to the carried interests in order to cover income tax obligations resulting from allocations of taxable income to the carried interests. These distributions are not subject to clawbacks but reduce future carried interest payments to which we become entitled from the applicable funds and were recorded as equity in earnings (loss) in the condensed consolidated statement of operations. Our investment in the Rialto funds totaled $170.8 million and $185.1 million as of May 31, 2023 and November 30, 2022, respectively.

As of May 31, 2023 and November 30, 2022, we had strategic technology investments in unconsolidated entities of $121.3 million and $131.5 million, respectively. Our strategic technology investments through our LENX business help to enhance the homebuying and home ownership experience, and help us stay at the forefront of homebuilding innovation.

Option Contracts

We often obtain access to land through option contracts, which generally enable us to control portions of properties owned by third parties (including land funds) and unconsolidated entities until we have determined whether to exercise the options.

The table below indicates the number of homesites to which we had access through option contracts with third parties and unconsolidated JVs (i.e., controlled homesites) and homesites owned (excluding homes in inventory):

																																	Years of
May 31, 2023															Controlled Homesites						Owned Homesites						Total Homesites						Supply Owned (1)
East															88,396						34,718						123,114
Central															40,298						26,922						67,220
Texas															75,316						28,734						104,050
West															60,118						24,462						84,580
Other															5,758						1,891						7,649
Total homesites															269,886						116,727						386,613						1.7
% of total homesites															70%						30%

																																	Years of
May 31, 2022															Controlled Homesites						Owned Homesites						Total Homesites						Supply Owned (1)
East															109,986						40,905						150,891
Central															42,281						33,652						75,933
Texas															90,443						35,194						125,637
West															70,434						35,502						105,936
Other															5,758						1,891						7,649
Total homesites															318,902						147,144						466,046						2.4
% of total homesites															68%						32%

(1)Based on trailing twelve months of home deliveries.

Details on option contracts and related consolidated inventory not owned and exposure are included in Note 9 of the Notes to Condensed Consolidated Financial Statements.

Contractual Obligations and Commercial Commitments

Our contractual obligations and commercial commitments have not changed materially from those reported in Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the fiscal year ended November 30, 2022, except for a decrease of $1.0 billion borrowings under the Financial Services' warehouse repurchase facilities.

(3) Recently Adopted Accounting Pronouncements

See Note 1 of the Notes to Condensed Consolidated Financial Statements included under Item 1 of this Quarterly Report on Form 10-Q for a discussion of recently adopted accounting pronouncements.

(4) Critical Accounting Policies

We believe that there have been no significant changes to our critical accounting policies during the six months ended May 31, 2023 as compared to those we disclosed in Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the fiscal year ended November 30, 2022.